This post was writ­ten with con­tri­bu­tions from Joan Gass, Scott Weathers, and a third coau­thor who would pre­fer to re­main anony­mous.

1. Context

Motivation

Our team came to­gether pri­mar­ily mo­ti­vated by an effec­tive al­tru­ist per­spec­tive. We be­lieve that alle­vi­at­ing an­i­mal suffer­ing is a top moral pri­or­ity, that the is­sue is rel­a­tively ne­glected, and that im­prov­ing sup­ply of al­ter­na­tive meats (e.g. clean meat, plant-based meat) will be more effec­tive than re­duc­ing de­mand for meat (e.g. dietary be­hav­ior change). At the time we started re­search­ing the topic, all of us were still in grad­u­ate school. Each of us had be­tween 9 months to 21 months be­fore our de­grees were com­plete.

Our goal as a team was to iden­tify whether there was a high-im­pact for-profit al­ter­na­tive meat startup we should launch (plant-based meat or clean meat). We wanted to pur­sue an idea that (1) had high po­ten­tial for so­cial im­pact, (2) was com­mer­cially vi­able, (3) we could fea­si­bly de­liver on given our skills and net­work, and (4) fit within our longer-term ca­reer goals. We started this re­search in Septem­ber 2017 and aimed to reach a de­ci­sion af­ter 5 months of re­search (enough time for the mem­ber of our team that was grad­u­at­ing soon­est to make post-grad­u­ate school plans).

Our Ra­tionale for Not Pur­su­ing an Alter­na­tive Meat Startup

By the end of our re­search (Fe­bru­ary 2018), we de­cided to hold off on pur­su­ing an al­ter­na­tive meat startup for the time be­ing. We iden­ti­fied promis­ing op­por­tu­ni­ties we think could have strong so­cial im­pact and com­mer­cial po­ten­tial, but we felt these were not ideal from a per­sonal-fit per­spec­tive at the mo­ment. In par­tic­u­lar, we felt we were not uniquely po­si­tioned to pur­sue these op­por­tu­ni­ties and that they were not ideal from a pro­fes­sional stand­point given our medium-term per­sonal ca­reer goals. How­ever, we each re­main ex­cited about the space and re­main open to pur­su­ing these ideas in the fu­ture.

We want to en­courage other po­ten­tial en­trepreneurs to en­ter this space, as we feel there are sub­stan­tial op­por­tu­ni­ties to do good and do well. We are writ­ing this doc­u­ment to share what we’ve learned in the hopes that it will en­courage and help oth­ers con­tribute to the in­dus­try. We would be happy to speak with in­di­vi­d­ual en­trepreneurs or re­searchers to share what we’ve learned.

2. Our Process

Iden­ti­fy­ing Ini­tial Opportunities

None of us had prior tech­ni­cal ex­pe­rience or a deep un­der­stand­ing of the plant based /​ clean meat space. As a re­sult, our first an­chor point was an un­offi­cial white pa­per that the Good Food In­sti­tute shared with us re­lated to ‘star­tups up they’d like to see.’ This was crit­i­cal to get us ex­cited about the space. We also in­for­mally asked in­di­vi­d­u­als we knew op­er­at­ing in the sec­tor. To nar­row down the list from sev­eral dozen ideas to 3 ma­jor topic ar­eas, we de­vel­oped the fol­low­ing ‘de­ci­sion crite­ria.’

De­ci­sion Criteria

Ex­pected so­cial im­pact: What is the over­all im­pact if suc­cess­ful, mul­ti­plied by the prob­a­bil­ity of suc­cess?

Mar­ket at­trac­tive­ness: What is the to­tal size of the mar­ket? What per­centage would be fea­si­ble to cap­ture? How fierce is the com­pe­ti­tion? What is the mar­ket power of buy­ers & sup­pli­ers? What is the growth of the mar­ket?

Eco­nomics: What mar­gins could we ex­pect? How prof­itable is the busi­ness likely to be? What in­vest­ment would be re­quired?

Com­pet­i­tive ad­van­tage /​ differ­en­ti­ated value propo­si­tion: Do we have some­thing that gives us a clear com­pet­i­tive ad­van­tage over what already ex­ists? Would this ad­van­tage be defen­si­ble against a com­peti­tor try­ing to copy it? (E.g. in­no­va­tive tech­nol­ogy, unique product idea, brand­ing/​mar­ket­ing, or team skills/​re­la­tion­ships?)

Per­sonal fit: Do we have the ex­per­tise on our team to de­liver on this idea? Does it fit in with our long-term ca­reer as­pira­tions?

Filter #1: Plant vs. Clean Meat

To try to nar­row down some of the ideas, one of the first filters we tried to ap­ply was plant-based meat vs. clean meat. We thought we might elimi­nate one of those cat­e­gories and fo­cus our efforts. We talked to sev­eral in­di­vi­d­u­als to de­ter­mine if we should con­sider clean meat. We found clean meat ap­peal­ing be­cause we an­ti­ci­pate that clean meat, if it be­comes cost-com­pet­i­tive with farmed meat, will be much more likely to reach mass-mar­ket sta­tus than plant-based meat. It would there­fore have much larger so­cial im­pact if suc­cess­ful. How­ever, we were con­cerned about the tech­nolog­i­cal challenges as­so­ci­ated with clean meat, the high de­gree of un­cer­tainty sur­round­ing the timeline of clean meat de­vel­op­ment and the costs of at-scale clean meat pro­duc­tion, and our cur­rent lack of tech­ni­cal knowl­edge around clean meat. We con­ducted a pre­limi­nary anal­y­sis of the clean meat value chain (see sec­tion 5 be­low) to iden­tify start up op­por­tu­ni­ties in this space. We ul­ti­mately did not end up us­ing plant vs. clean meat as a filter, and ex­plored op­por­tu­ni­ties in both spaces.

Filter #2: So­cial Im­pact—Com­par­ing An­i­mal Suffering

Another filter we con­sid­ered was the type of meat we wanted to pro­duce (e.g. chicken, fish, beef, pig prod­ucts). We knew that our meat al­ter­na­tive star­tups could have large effects on a wide range of is­sues, in­clud­ing an­tibiotic re­sis­tance, cli­mate change, nu­tri­tion, and more, mak­ing this an at­trac­tive op­tion to many differ­ent value sets. How­ever, one of the so­cial im­pact lenses we an­a­lyzed in depth was al­ter­na­tive meat’s im­pact on an­i­mal suffer­ing. Past re­search in­di­cates that the size of an­i­mal is a key driver of the amount of suffer­ing that its as­so­ci­ated prod­ucts gen­er­ate, since smaller an­i­mals will tend to pro­duce much less meat per unit of suffer­ing caused. In ad­di­tion, re­search in Com­pas­sion, by the Pound in­di­cates that pigs and chick­ens suffer sub­stan­tially more than cows in fac­tory farms. Ev­i­dence seems to in­di­cate that chicken and fish prod­ucts cause the most suffer­ing on stan­dard­ized met­rics (1, 2, 3, 4, 5, 6). Ac­cord­ing to one un­cer­tain anal­y­sis that tried to es­ti­mate “equiv­a­lent days of suffer­ing” caused by differ­ent an­i­mal prod­ucts, pro­duc­tion of a sin­gle kilo­gram of cat­fish causes 1600 days of suffer­ing com­pared to 66 days for a kilo­gram of chicken and 1.9 days for a kilo­gram of beef.

Act­ing on this be­lief, we would strongly en­courage other po­ten­tial startup founders to con­sider fo­cus­ing on eggs, chicken, fish, or re­lated prod­ucts if they pri­ori­tize de­creas­ing an­i­mal suffer­ing, as we be­lieve these pre­sent the best op­por­tu­nity for over­all im­pact. Given that these an­i­mal pro­teins are of­ten con­sumed as in­gre­di­ents in prod­ucts where they could eas­ily be sub­sti­tuted, we be­lieve there is large room for im­pact cur­rently be­ing ne­glected.

Notably, al­though we be­lieve that fish al­ter­na­tives are likely net-pos­i­tive in ex­pected value, we have a large de­gree of un­cer­tainty re­gard­ing this con­clu­sion. Since it is not clear whether wild-caught fish have net-nega­tive or pos­i­tive lives, we can’t be con­fi­dent about the im­pact that dis­plac­ing ocean fish­ing would have. A va­ri­ety of other con­sid­er­a­tions, in­clud­ing the sub­sti­tu­tion of farmed and wild-caught fish prod­ucts, will af­fect the im­pact of any startup de­voted to fish prod­ucts. We ap­pre­ci­ate the work of Ge­or­gia Ray in re­search­ing this ques­tion for us, and would greatly ap­pre­ci­ate other re­searchers fo­cused on wild an­i­mal suffer­ing to con­tinue de­vel­op­ing em­piri­cal ev­i­dence on this ques­tion.

As a re­sult, one of the pre­limi­nary filters we ap­plied was to look at fish and chicken prod­ucts in the clean meat and plant-based meat space.

We fur­ther nar­rowed down our fo­cus by an­a­lyz­ing which prod­ucts are con­sumed in the largest vol­umes. We found that the US mar­ket was pri­mar­ily com­posed of forms of fresh and frozen fish fillets, fresh and frozen chicken breast, and eggs (see US mar­ket siz­ing re­search in the ap­pendix.)

After an in­ter­view with a food sci­en­tist from Im­pos­si­ble Foods, we iden­ti­fied that ‘whole mus­cle’ pro­teins like fresh and frozen fish fillets and chicken breast are harder to de­velop. We there­fore pri­mar­ily fo­cused on non ‘whole mus­cle’ pro­teins like fish sticks and chicken nuggets. Th­ese prod­ucts are eas­ier to pro­duce as they have a more flex­ible tex­ture and gain a large pro­por­tion of their taste and tex­ture from bread­ing and sea­son­ing. We be­lieve that im­pact in this space would oc­cur from de­riv­ing a bet­ter for­mu­la­tion than ex­ist­ing prod­ucts and/​or pen­e­trat­ing a new sub-seg­ment of con­sumers. As a re­sult, a sec­ondary filter we ap­plied was to look plant-based prod­ucts like fish sticks and chicken nuggets.

An al­ter­na­tive ap­proach we con­sid­ered would be to push the fron­tier of plant-based in­gre­di­ent repli­cas. There are ar­eas of seafood and chicken where plant-based repli­cas do not cur­rently ex­ist (e.g. plant-based oc­to­pus). Even in sec­tors with a small mar­ket size, we be­lieve there is value to the demon­stra­tion effect that shows that new plant-based repli­cas are pos­si­ble. Ad­di­tion­ally, we be­lieve there are mar­kets in which con­sumers are less at­tached to an­i­mal-based prod­ucts, such as eggs in bak­ing and as in­gre­di­ents in pre­pared foods, fish sauces, and surimi (e.g. crab in sushi). Given will­ing­ness of con­sumers to ac­cept sub­sti­tutes, a plant-based al­ter­na­tive at a lower price point has promis­ing mar­ket reach. Fi­nally, we be­lieve that egg-based repli­cas are likely par­tic­u­larly high im­pact given the harm ex­pe­rienced by egg-lay­ing chick­ens. We ended up not pur­su­ing these op­por­tu­ni­ties in depth as we did not have con­nec­tions with tech­ni­cal ex­per­tise to push for­ward the in­no­va­tion fron­tier in this area.

3. Short listed busi­ness ideas

We ar­rived at the fol­low­ing as our top ideas, and would en­courage other en­trepreneurs to con­sider move for­ward with them:

Plant Based Meat Start Up Ideas

1)Plant-based fish sticks or chicken nuggets: One idea we had was to de­velop an ex­tremely low-cost product, likely to sell through ex­ist­ing restau­rant chains and/​or gro­cery stores, along the lines of what Seat­tle Food Tech is pro­duc­ing. Fish sticks and chicken nuggets may be may be among the worst prod­ucts in terms of marginal an­i­mal suffer­ing, have large an­nual sales, and do not rely pri­mar­ily on an­i­mal meat for taste/​tex­ture, mak­ing them a vi­able can­di­date plant-based sub­sti­tutes. We con­ducted re­search with food ser­vice com­pa­nies in schools and found that cost, meet­ing offi­cial nu­tri­tional guidelines (to qual­ify for re­im­burse­ment), and taste were crit­i­cal com­po­nents. Pack­ag­ing, re­friger­a­tion re­quire­ments, shelf life, and aller­gens were also con­sid­er­a­tions. Some pur­chasers even in­di­cated a will­ing­ness to pay a price pre­mium for plant-based meat if other crite­ria listed above were met. We be­lieve that these pur­chas­ing crite­ria ex­tend to other food ser­vice com­pa­nies (such as hos­pi­tals and prison sys­tems).

If we were to move for­ward, we would want to un­der­stand the com­pet­i­tive po­si­tion­ing of cur­rent plant-based fish stick and chicken nugget com­pa­nies and have a clear differ­en­ti­ated value propo­si­tion. We be­lieve that work­ing with a co-packer to pro­duce a white-la­beled product for large food ser­vice providers could be an effi­cient way to launch with min­i­mal mar­ket­ing spend. How­ever, the fi­nan­cial mar­gins for these prod­ucts ap­pear to be small, mean­ing that star­tups at­tempt­ing to take this prob­lem on may have to ac­cept ra­zor-thin prof­its. Devel­op­ing ca­pac­ity to pro­duce in large vol­umes would there­fore be crit­i­cal.

Re­ports we’ve heard in­di­cate that ex­tru­sion ca­pac­ity is cur­rently the limit­ing fac­tor driv­ing up costs for plant-based al­ter­na­tives in the United States. As a re­sult, we’d only want to pur­sue this path if we have strong rea­son to be­lieve that our plant-based al­ter­na­tive was not dis­plac­ing a bet­ter plant-based al­ter­na­tive in the mar­ket. Our ini­tial in­ter­views sug­gested it is pos­si­ble to pro­duce prod­ucts that does not re­quire ex­tru­sion (per­haps us­ing jack­fruit) which could en­able higher vol­ume pro­duc­tion at lower cost than cur­rent prod­ucts on the mar­ket. We en­courage en­trepreneurs to ex­plore this route.

2)Plant-based func­tional meat in In­dia or an­other Asian econ­omy: We con­sid­ered de­vel­op­ing a com­pany to pro­duce broadly us­able “func­tional meats,” which can be used as an in­gre­di­ent across many recipes, rep­re­sent a promis­ing op­por­tu­nity to reach con­sumers cook­ing at home, restau­rants, and mak­ers of pro­cessed foods. At low-cost, these prod­ucts could sub­sti­tute for a broad range of an­i­mal-based in­gre­di­ents in cur­ries, birya­nis, and other In­dian dishes. We se­lected In­dia as a promis­ing coun­try be­cause our re­search team has some ex­pe­rience work­ing there, a large pro­por­tion of the coun­try speaks English, con­sump­tion of fish and chicken is grow­ing, and a high pro­por­tion of the coun­try is veg­e­tar­ian. We were also ex­cited about work­ing in a de­vel­op­ing coun­try to pro­mote eco­nomic growth (e.g. strength­en­ing lo­cal man­u­fac­tur­ing).

We did not move for­ward with this idea be­cause of our limited abil­ity to un­der­stand the com­pet­i­tive po­si­tion­ing of ex­ist­ing com­pa­nies in In­dia (e.g. Good Dot) and our limited con­nec­tion with man­u­fac­tur­ing /​ food sci­ence tal­ent in In­dia.

We would en­courage en­trepreneurs to con­tinue to ex­plore the space. In ad­di­tion to In­dia, we en­courage en­trepreneurs to ex­plore China ($161B in meat /​ live­stock), Ja­pan, Thailand, and Viet­nam – par­tic­u­larly if the fu­ture co-founder teams have a rele­vant cul­tural or lin­guis­tic back­ground (see the ap­pendix for es­ti­mates of mar­ket size for the meat & live­stock mar­kets in Asia-Pa­cific).

Clean Meat Start-Up Ideas

Our un­der­stand­ing of the clean meat space is as fol­lows:

a) Cell lines: It is our un­der­stand­ing that most clean meat star­tups already have their own cell lines or plan to iden­tify cell lines in-house.

b) Me­dia: Me­dia ap­pears to be the largest cost con­trib­u­tor and most im­por­tant im­me­di­ate bar­rier to clean meat scale-up, so we were most ex­cited about a startup in this space. How­ever, it’s our un­der­stand­ing that an­other startup (ten­ta­tively named “Oxford Cul­ture Me­dia”) has re­cently re­ceived fund­ing to do just this. We ex­pect there will be room for mul­ti­ple me­dia com­pa­nies in the clean meat space, but weren’t yet con­fi­dent that it made sense to form an­other startup at this time.

c) Scaf­fold­ing: We ex­pect scaf­fold­ing will be much less im­por­tant in the short-term as clean meat com­pa­nies are likely to first fo­cus on ground meat prod­ucts. Scaf­fold­ing re­search will be im­por­tant in the longer term, how­ever, to de­velop struc­tured prod­ucts and po­ten­tially to im­prove the effi­ciency of biore­ac­tors.

d) Biore­ac­tors: There is ur­gent need to ad­vance biore­ac­tor tech­nol­ogy for clean-meat. How­ever, we are un­cer­tain whether a startup would be ideally po­si­tioned to de­velop biore­ac­tors, which are en­g­ineer­ing-heavy and highly cap­i­tal in­ten­sive. We imag­ine that larger, es­tab­lished com­pa­nies may be bet­ter po­si­tioned to pro­duce biore­ac­tors for the field.

Based on this think­ing, we ex­plored two po­ten­tial start up ideas in the clean meat sec­tor.

3)Pro­vid­ing B2B clean meat tech­nol­ogy ser­vices: Fo­cus on one of the in­ter­me­di­ary tech­nolo­gies—for ex­am­ple, iden­ti­fy­ing cell lines, de­vel­op­ing me­dia for­mu­la­tions, re­search­ing scaf­fold­ing, or de­vel­op­ing biore­ac­tors—and sell to clean meat star­tups. This space ap­pears gen­er­ally open and at­trac­tive, al­though we did not find an ideal point for us to en­ter (see anal­y­sis above). We have heard that larger, es­tab­lished biotech com­pa­nies are think­ing of mov­ing into this space, which may crowd out op­por­tu­ni­ties for en­trepreneurs.

4)Plant-based & clean meat chicken-nugget hy­brid: Our idea was to first de­velop a low-cost plant-based chicken nugget, with the goal of even­tu­ally in­cor­po­rat­ing clean chicken meat as an in­gre­di­ent to pro­duce an in­ex­pen­sive clean chicken product. Suc­cess here would de­pend on be­ing first-to-mar­ket with a clean meat tech­nol­ogy that is differ­en­ti­ated from com­peti­tors. While a grow­ing num­ber of com­pa­nies have already en­tered the clean meat space, our sense is that there are a va­ri­ety of ap­proaches to clean meat pro­duc­tion yet to be tested, and a new startup might still have room to carve out a tech­nolog­i­cal niche. We be­lieve that clean meat com­pa­nies should pur­sue, and are pur­su­ing, blended plant and clean meat based prod­ucts, which will be eas­ier to de­velop than pure-clean meat prod­ucts while the tech­nol­ogy re­mains new.

Our in­ves­ti­ga­tion of clean meat was pre­limi­nary, and our think­ing re­mains highly sub­ject to change. We in­tend to stay in touch with our con­tacts to con­tinue up­dat­ing our po­si­tion on clean meat. We would be ex­cited to even­tu­ally part­ner with a sci­en­tist in this field as we build our un­der­stand­ing of the tech­nol­ogy, eco­nomics, and timeline.

Cur­rent Think­ing on Clean Meat

We are 1) ex­cited about the re­search cur­rently un­der­way, 2) con­vinced that much more R&D is needed in this space, and 3) hope­ful that clean meat prod­ucts (per­haps com­bined with plant-based in­gre­di­ents) will even­tu­ally break through.

After speak­ing with a half dozen en­trepreneurs, sci­en­tists, and ex­perts on this topic, our ten­ta­tive con­clu­sion is that mass com­mer­cial­iza­tion of clean meat may still be years away (per­haps 5-10), and there re­mains sig­nifi­cant un­cer­tainty around this timeline, al­though a small num­ber of high-end, niche prod­ucts may emerge soon (6-24 months).

We are also un­cer­tain whether clean chicken will be­come cost-com­pet­i­tive with farmed chicken, given that farmed chicken already has high caloric con­ver­sion effi­ciency. Us­ing my­co­pro­tein as a bench­mark, we tried to es­ti­mate po­ten­tial effi­ciency gains of clean chicken vs. farmed chicken in terms of con­vert­ing feed calories into pro­tein calories. Our ten­ta­tive es­ti­mate is that clean chicken could see up to 25% cheaper feed costs in the most op­ti­mistic sce­nario, which would have to cover the po­ten­tially higher fixed costs of clean meat pro­duc­tion (e.g. from biore­ac­tors, ster­il­iza­tion, and more highly skil­led la­bor) and more ex­pen­sive me­dia ad­di­tives for clean meat to be cost com­pet­i­tive with farmed meat. (See the ap­pendix for more de­tails on this es­ti­mate.)

Whether we even­tu­ally get in­volved in clean meat de­pends on whether we can find a strong tech­ni­cal co-founder with clear ideas on a differ­en­ti­ated ap­proach to the tech­nol­ogy. We have some po­ten­tial leads and will con­tinue to try to cul­ti­vate part­ner­ships.

4. Sources of Information

As we were ramp­ing up on the space, we found the Good Food In­sti­tute par­tic­u­larly helpful in pro­vid­ing an ini­tial ori­en­ta­tion. As we were re­search­ing rel­a­tive an­i­mal suffer­ing, we found writ­ings by Lewis Bol­lard, Brian To­masik and Com­pas­sion, by the Pound by Nor­wood and Lusk valuable re­sources. As we were re­search­ing the plant-based meat space, we found GFI’s plant-based meat white pa­per, Mar­ket Re­ports (our uni­ver­sity library was helpful to find these), and speak­ing with in­di­vi­d­u­als in our aca­demic /​ per­sonal net­work (in­clud­ing GFI di­rec­tory & FEED Col­lab­o­ra­tive at Stan­ford) very valuable. As we were learn­ing about the clean meat space, we found GFI’s Clean Meat white pa­per, the book Clean Meat by Paul Shapiro, and speak­ing with in­di­vi­d­u­als in our aca­demic /​ per­sonal net­work (in­clud­ing GFI di­rec­tory) par­tic­u­larly helpful.

5. Conclusion

Ul­ti­mately, we have de­cided to pause our search for now, while con­tin­u­ing to stay up to speed and keep a look­out for emerg­ing op­por­tu­ni­ties. Us­ing our De­ci­sion Cri­te­ria in Sec­tion 2, the pri­mary rea­sons we are paus­ing our search are:

● Com­pet­i­tive ad­van­tage: We do not feel that we have yet iden­ti­fied a clear, defen­si­ble com­pet­i­tive edge in any of our pri­or­ity busi­ness ideas. For ex­am­ple, while we feel there is a need for cheaper clean chicken and fish, we ex­pect that ex­ist­ing play­ers will be able to pro­duce these prod­ucts, and were not yet able to iden­tify how we could de­velop a defen­si­ble ad­van­tage (al­though we have not ruled out the pos­si­bil­ity of find­ing this in the fu­ture—par­tic­u­larly if we were con­nected to a tech­ni­cal cofounder or unique product ap­proach).

● Per­sonal fit: We are work­ing on other pro­jects and long-term in­ter­ests that more di­rectly lev­er­age our past ex­pe­rience and fit more clearly into our longer-term ca­reer as­pira­tions. For ex­am­ple, some of us are more fo­cused on in­fluenc­ing policy in the long-run, which we be­lieve would be the most im­pact­ful use of our skills, and we felt the ideas above didn’t clearly fa­cil­i­tate this tra­jec­tory. We also have not yet found a strong tech­ni­cal cofounder, which we think would be im­por­tant given our lack of tech­ni­cal skills. We re­main deeply pas­sion­ate about meat al­ter­na­tives and open to the idea of launch­ing a startup in the fu­ture, but we felt at the time be­ing the per­sonal fit and timing wasn’t ideal.

We also feel that the food in­dus­try is in gen­eral com­pet­i­tive and challeng­ing to reach prof­ita­bil­ity with­out sig­nifi­cant scale. How­ever, this con­cern is some­what offset by the rapid growth of al­ter­na­tive meat prod­ucts, the amount of in­vestor en­thu­si­asm for al­ter­na­tive meat, and the sig­nifi­cant so­cial im­pact po­ten­tial.

We would be ex­cited to hear in­put on our con­clu­sions.

6. Next Steps for En­trepreneurs

If we were to move for­ward with an idea in the plant-based sec­tor, sources in the in­dus­try in­di­cated we could plan for some­thing as fol­lows over the first year (al­though we re­main un­cer­tain if this is the right se­quence & timeline):

Trial pro­to­type with a co-packer who can man­u­fac­ture & pro­duce at scale:3-9 months

○ Dur­ing this pe­riod, de­velop pack­ag­ing, brand­ing, and re­la­tion­ships with buy­ers and distributors

If we were to move for­ward, we would sig­nifi­cantly hone & sharpen this timeline. We in­clude it here just to share some of the in­put we gained from in­ter­views.

7. Appendix

US Chicken and Fish Mar­ket Sizing

The US Seafood mar­ket is $3B in­dus­try with al­most no growth pro­jected (.4% pro­jected for ‘17-’22 com­pared to his­tor­i­cal growth rate of 3.7% from ’12-’17). The largest seg­ment is fresh fish (46%), fol­lowed by frozen fish (30%), fish meal and fish oil (17%). Canned fish is quite small at ~3% of the mar­ket which is com­pa­rable to the fish prod­ucts used in an­i­mal food. (Fish & Seafood Mar­ket in the US; IBISWorld, Oct 2017, John Madi­gan)

In com­par­i­son, the US Chicken and Turkey in­dus­try is a $35.1B in­dus­try with a his­tor­i­cal an­nual growth rate of 1.4% (’12-’17) and pro­jected growth rate of 1.1% (’17-’22). While we couldn’t find a break­down for the spe­cific type of prod­ucts, we did find that the mar­ket was sig­nifi­cantly driven by chicken sales. Speci­fi­cally, larger broiler chick­ens were 54% of the mar­ket, smaller broiler chick­ens were 30.9% of the mar­ket, turkeys were 14.8% of the mar­ket, and 0.3% of or­ganic op­er­a­tions. (Chicken and Turkey Meat Pro­duc­tion in the US; IBISWorld, Oct 2017, Jack Cur­ran)

The Egg and Poul­try Whole­sale mar­ket in the US is an $11.5B in­dus­try, com­posed of 38.6% fresh /​ re­friger­ated chicken, 35.7% eggs, 9% pro­cessed or frozen poul­try, 8.8% turkey, duck, quail and other fresh poul­try, and 7.9% other. (Egg and Poul­try Whole­sal­ing in the US; IBISWorld, Dec 2016, An­thony Gam­bardella)

Price Benchmarking

We performed pre­limi­nary price bench­mark­ing that may be use­ful to prospec­tive en­trepreneurs.

Clean Meat Effi­ciency Estimates

We looked at my­co­pro­tein (the pro­tein used in Quorn prod­ucts) as an up­per-bound bench­mark to es­ti­mate the max­i­mum plau­si­ble caloric effi­ciency that clean meat pro­duc­tion could achieve. Cost sav­ings from clean meat rel­a­tive to farmed meat are likely to come pri­mar­ily from lower feed costs, which com­prise the bulk of farmed chicken costs (60-75% of costs based on our re­search). As such, we fo­cused on es­ti­mat­ing the sav­ings that would come from the higher caloric con­ver­sion effi­ciency of clean meat.

My­co­pro­tein is de­vel­oped us­ing a similar pro­cess to sus­pen­sion cul­ture: fun­gal cells are mass-pro­duced through cell di­vi­sion in biore­ac­tors us­ing wheat & corn calories and min­er­als, and later com­bined with plant in­gre­di­ents to form a fi­nal product. Our un­der­stand­ing is that fun­gal cells have similar metabolic effi­ciency to an­i­mal cells, and one ex­pert told us my­co­pro­tein may be eas­ier to grow and more effi­cient than avian and mam­malian cells. As Quorn has had decades to re­fine the my­co­pro­tein pro­duc­tion pro­cess (since 1985), we sus­pect they are ap­proach­ing op­ti­mal effi­ciency. As such, the caloric con­ver­sion effi­ciency of Quorn’s my­co­pro­tein pro­cess seems rea­son­able as an up­per-bound limit to what clean chicken, once op­ti­mized, could achieve.

Given this bench­mark, we es­ti­mated that clean chicken could see up to 25% vari­able cost sav­ings (as­sum­ing, op­ti­misti­cally, it reaches the calorie con­ver­sion ra­tio of my­co­pro­tein) com­pared to farmed chicken due to sav­ings from feed, based on the figures be­low.

We an­ti­ci­pate that non-feed costs are likely to be higher for clean chicken due to the in­vest­ment re­quired for ster­il­iza­tion, ex­pen­sive biore­ac­tors, skil­led la­bor, and greater R&D re­quire­ments. Clean chicken will only be cost-com­pet­i­tive if all of these ad­di­tional costs fall be­low the 25% po­ten­tial vari­able sav­ings from feed. This es­ti­mate sug­gests that clean chicken may be able to beat farmed chicken on a vari­able cost ba­sis once fully op­ti­mized, but we are un­cer­tain whether it would re­main cost-com­pet­i­tive once ac­count­ing for fixed costs.

Great write up. I’m a fan of the sys­tem­atic think­ing and re­search. It’s in­ter­est­ing to com­pare how you ap­proached it to how Char­ity En­trepreneur­ship are look­ing into non-profit startup op­por­tu­ni­ties. I’m in­ter­ested in how you weighed up the de­ci­sion crite­ria; was this just in­tu­itive, based off the rest of the re­search, or did you have an­other ap­proach?

One area where I might di­verge from your ap­proach here is in how you con­cep­tu­al­ise ex­pected so­cial im­pact. I get the im­pres­sion here (mainly from your use of “Filter #2: So­cial Im­pact—Com­par­ing An­i­mal Suffer­ing”) that you pri­mar­ily con­cep­tu­al­ise the im­pact of a startup in terms of the the prod­ucts that that startup pro­duces and the an­i­mal prod­ucts that it re­places coun­ter­fac­tu­ally. But a broader con­cep­tu­al­i­sa­tion of the im­pact of a startup might in­clude its con­tri­bu­tion (pos­i­tive or nega­tive) to the over­all even­tual suc­cess (i.e. mar­ket share) of plant-based meat and/​or clean meat. In the long-term, this could well mat­ter more for to­tal im­pact.

So a startup which in­tro­duces a cel­lu­lar agri­cul­ture product re­plac­ing an an­i­mal product that causes rel­a­tively small amounts of suffer­ing might still be far more im­pact­ful than some other startup ideas (e.g. a startup that brings a good clean chicken product to mar­ket at a bet­ter price point than its com­peti­tors) if it helps to bring cel­lu­lar agri­cul­ture prod­ucts to mar­ket in a way that has wider pub­lic sup­port. Although each of these ex­am­ples has a long list of pros and cons, this spe­cific goal might be bet­ter achieved by:

2) Fo­cus­ing on prod­ucts which are more widely con­demned by the pub­lic, e.g. foie gras

3) Fo­cus­ing on mar­ketis­ing the prod­ucts in coun­tries which are more likely to be sup­port­ive, even if the to­tal mar­ket is smaller, e.g. Sin­ga­pore (see here).

In each of these ex­am­ples, bring­ing the prod­ucts to mar­ket in those spe­cific con­texts might in­crease con­sumer ac­cep­tance of the higher pri­or­ity prod­ucts, since they (or lots of peo­ple in other coun­tries) will already be us­ing cel­lu­lar agri­cul­ture prod­ucts.

A differ­ent ap­proach might be to start­ing a B2B startup which fo­cuses on pro­vid­ing a cheap—but also sta­ble and se­cure—spe­cific in­gre­di­ent, e.g. growth me­dia (this one over­laps with some of your sug­ges­tions). This might re­quire that their busi­ness fo­cuses on sel­l­ing to a broader cus­tomer base, in­clud­ing med­i­cal com­pa­nies and sci­en­tific re­searchers, to en­sure that they have a busi­ness model that isn’t wholly de­pen­dent on the (po­ten­tially fluc­tu­at­ing) for­tunes of the rest of the clean meat sup­ply chain.

Po­ten­tially these strate­gic con­cerns might mat­ter less for plant-based foods. I can think of ways it would in­fluence de­ci­sion-mak­ing though, like fo­cus­ing heav­ily on price, so that less well-off peo­ple can ac­cess plant-based foods, to re­duce the risk that plant-based food be­comes con­fined to well-off peo­ple and spe­cific de­mo­graph­ics (hip­pies/​hip­sters) due to the real bar­rier that price puts up and/​or due to pub­lic per­cep­tions and iden­tity is­sues.

Gen­er­ally, I’m ar­gu­ing for con­sid­er­ing a long-term “strate­gic” per­spec­tive to think­ing about the so­cial im­pact of start-ups. J at Sen­tience In­sti­tute has writ­ten two tech­nol­ogy adop­tion stud­ies on nu­clear power and GM foods which I think are helpful for think­ing about these sorts of per­spec­tives. He’s cur­rently writ­ing a third, on biofuels—I imag­ine that that will be similarly use­ful, and that we’ll start to see trends and pat­terns oc­cur­ring across the tech­nol­ogy adop­tion stud­ies as he does more.

Hey, Jamie, thanks for your thoughts! I’ll speak for my­self, as our en­tire team hasn’t had time to re­view your com­ment yet.

Your com­par­i­son to CE’s ap­proach is fair, al­though there are a num­ber of differ­ences. We did con­sider op­por­tu­ni­ties out­side of plant-based/​clean meat but I was not in­volved with the re­search at that point. Our de­ci­sion crite­ria within this space was in­formed pri­mar­ily by our judg­ment as EAs and as a team with ex­pe­rience in busi­ness/​con­sult­ing of the fac­tors likely to mat­ter most for im­pact and suc­cess of the com­pany.

I definitely agree that the broader con­cep­tu­al­iza­tion of im­pact is a crit­i­cal frame­work to con­sider. How­ever, I don’t nec­es­sar­ily think that our two ap­proaches are mu­tu­ally ex­clu­sive. For ex­am­ple, a high-qual­ity chicken/​fish sub­sti­tute could do just as much to ad­vance the field of plant-based prod­ucts as a high-qual­ity burger (or per­haps even more, given the large num­ber of beef prod­ucts on the mar­ket now). We con­sid­ered the fac­tor you’re high­light­ing to some ex­tent in our de­ci­sion-mak­ing, as you can see in our se­lec­tion of de­vel­op­ing a product in an Asian econ­omy, which could spur the cre­ation of new prod­ucts/​com­pa­nies in this area if done suc­cess­fully. Our ap­proach in clean meat—to fo­cus on in­ter­me­di­ary tech­nolo­gies, e.g. cell lines, me­dia for­mu­la­tions, etc. is also in­formed by your ap­proach, as this likely would do more good by ad­vanc­ing the field as a whole than by hav­ing di­rect im­pact.

Nice writeup. One big ad­van­tage of fun­gus-based meat sub­sti­tutes is that they can grow on waste prod­ucts (low­er­ing cost and en­vi­ron­men­tal im­pact). This is typ­i­cally done for mush­rooms, but not Quorn. Does any­one know why?

Won­der­ful writeup! Strong up­vote for the struc­ture, use of ta­bles, and anal­y­sis of fu­ture pos­si­bil­ities.

You may want to define, or link to defi­ni­tions of, terms like “scaf­fold­ing” and “ex­tru­sion” that may not be fa­mil­iar to most read­ers in this con­text.

Also, de­spite not hav­ing a tech­ni­cal co-founder on the team, did you still feel like you were able to con­duct effec­tive re­search on al­ter­na­tive-meat en­g­ineer­ing? It seems like you have a pretty thor­ough un­der­stand­ing of tech­nol­ogy in the space, and what prod­ucts might be use­ful to de­velop, but I can imag­ine that tak­ing a long time or be­ing re­ally difficult with­out a tech­ni­cal back­ground. Do you have any ad­vice to share on learn­ing to un­der­stand a field’s en­g­ineer­ing, product de­vel­op­ment, etc., with­out a strong back­ground in those sub­jects?

Good ques­tion! And thanks for your point, we should have linked to defi­ni­tions of terms.

I think that we were able to con­duct effec­tive tech­ni­cal re­search in this space largely be­cause we spoke to a ton of founders of com­pa­nies and thor­oughly read the pub­lished sci­en­tific liter­a­ture. Ad­di­tion­ally, we split up tasks to max­i­mize spe­cial­iza­tion/​ex­per­tise within each do­main that we cared about. Those would be my two pri­mary pieces of ad­vice. We did not have a strong back­ground in these sub­jects be­fore be­gin­ning, so I would not let that de­ter you from div­ing in.

Com­pa­nies ob­vi­ously don’t want to share their trade se­crets, so you can’t ex­pect to learn ev­ery­thing about the field but a ded­i­cated EA, es­pe­cially with a strong sci­ence back­ground, can de­velop a strong enough un­der­stand­ing to make a ca­reer-rele­vant de­ci­sion about the state of the field.

I’d also love to hear Scott’s per­spec­tive on this, but in the mean­time, I wanted to point out that this is one of the ways The Good Food In­sti­tute aims to help po­ten­tial founders. For starters, I’d recom­mend these es­sen­tial re­sources.

Re­ports we’ve heard in­di­cate that ex­tru­sion ca­pac­ity is cur­rently the limit­ing fac­tor driv­ing up costs for plant-based al­ter­na­tives in the United States. As a re­sult, we’d only want to pur­sue this path if we have strong rea­son to be­lieve that our plant-based al­ter­na­tive was not dis­plac­ing a bet­ter plant-based al­ter­na­tive in the mar­ket.

Most plant-based meats get their form and tex­ture through high-mois­ture ex­tru­sion, in which tex­tured veg­etable pro­tein is forced through a die like Play-Doh through a spaghetti maker (see Wikipe­dia for a more tech­ni­cal overview).

Ex­trud­ers are big, ex­pen­sive, and sen­si­tive ma­chines. Most star­tups can’t buy their own, so they nor­mally con­tract with a man­u­fac­turer. How­ever, there is a limited num­ber of man­u­fac­tur­ers that cur­rently do high-mois­ture ex­tru­sion of tex­tured veg­etable pro­tein.

I like this way of think­ing. It’s im­por­tant to con­sider whether our di­rect im­pact is ac­tu­ally differ­ent than the coun­ter­fac­tual.

But for­tu­nately for prospec­tive plant-based meat en­trepreneurs, there are sev­eral rea­sons why my col­leagues at The Good Food In­sti­tute think dis­place­ment may not be as big of an is­sue here (and I agree):

1. A new plant-based meat com­pany cre­ates new de­mand for ex­tru­sion ca­pac­ity. Con­sis­tently in­creas­ing de­mand for ex­tru­sion ca­pac­ity sig­nals to man­u­fac­tur­ers that they should in­vest in cap­i­tal ex­pen­di­ture.

2. Alter­na­tive man­u­fac­tur­ing pro­cesses are be­ing de­vel­oped that do not re­quire high-mois­ture ex­tru­sion (e.g., sheer cell tech­nol­ogy). A new plant-based meat com­pany could ei­ther di­rectly con­tribute to de­vel­op­ing these tech­nolo­gies or in­di­rectly con­tribute by demon­strat­ing de­mand for the tech­nol­ogy.

3. Ex­tru­sion ca­pac­ity tends to go to the pro­ducer with the high­est will­ing­ness to pay. In gen­eral, this will fa­vor com­pa­nies that are more ma­ture, have higher sales, or have more in­vest­ment. Although im­perfect, these fac­tors cor­re­late with product qual­ity, de­creas­ing the like­li­hood that a worse product will dis­place a bet­ter one.

Thank you so much for shar­ing this re­search pub­li­cly! I’m also look­ing at the value chain in the clean/​al­ter­na­tive meat space with an eye to­wards en­trepreneur­ship or join­ing an ex­ist­ing co. so see­ing the re­sults of your work is very helpful.